Budget Without Excitement

10 years ago | 1819

First Bank

Even though President Goodluck Jonathan proposes in his 2013 federal budget to create 3.5 million jobs, not many jobless Nigerians are excited by that prospect

By Ishaya Ibrahim  |  Nov. 19, 2012 @ 01:00 GMT

ISAH JIBRIN, a 1996 graduate of laboratory science from the Nuhu Bamali Polytechnic, Zaria, has still not gotten his dream job after leaving school 16 years ago. He made a brief stint in business, selling computer accessories in Kaduna without success. He is now a small time livestock farmer in his home town of Kawo Kaduna, but still praying to get the ideal job.

But he said without ‘connection’, there is almost no hope of getting a good job in Nigeria. Even the 3.5 million jobs President Goodluck Jonathan mentioned in his budget speech, which would be created over the next one year, does not excite Jibrin. “We are used to such promises. All of them {previous governments} said the same thing. I don’t believe it”, he said.

Lazarus Nnabugwu, an okada rider in Lagos State, also has a similar tale, saying he was forced into Okada business when he couldn’t get a job after graduating with a bachelor of education degree in geography from the Lagos State University in 2005. Initially, he said he was shy, doing okada job. But he later found it enjoyable, making up to N6,000 a day on the Ajuwon-Ikeja route.

Recently, his money making okada business suffered a major setback when the Lagos State government, banned Okada riders from operating on many routes which, for them, were the goldmines of the business. He said with the ban, he hardly makes up to N 1000. “Things are tough now. Before, I was able to make enough to take care of my family and put some money into my savings account. But now, we are living from hand to mouth”, he said, adding. “If not for circumstances, I wouldn’t be an Okada man”.

So, when President Goodluck Jonathan presented the 2013 budget estimate tagged, Fiscal Consolidation with Inclusive Growth, on October 10, these Nigerians were not interested.  Their reason is that the budget would not have any impact on them.  Of course, with the worsening unemployment, especially now that Ph.D. holders are applying for driving job reserved for secondary school graduates, these Nigerians don’t see how the 2013 budget can make any difference in their situation.

But President Jonathan was optimistic that in 2013, Nigerian youths would smile, because according to him, more jobs would be created. “We have mentioned the 3.5 million jobs we aim to create in agriculture and more jobs in the housing and construction sectors, solid minerals sector, aviation and the creative industry”, the president said.

Ironically, the Aviation sector, where the President hopes to create jobs for many Nigerians has actually seen many losing jobs in the last one year. For instance, Air Nigeria which took the lion share of N35.5 billion of the federal government intervention fund to support the sector, closed shop in September this year due to paucity of fund, leaving  2000 staff of the company jobless, with a backlog of salaries owed them. Other airlines that have left the scene include Chanchangi airline and Dana Air, which suspended its operations after one of its planes crashed in June this year.

In the budget speech, the president said his administration is working hard to improve the regulatory regime and safety of the Aviation sector and also introduce a regime of zero tariff on spare parts importation into the country. To stakeholders in the sector, this would help to relieve the high cost of maintaining aircraft overseas at heavy costs.

Another area on which Nigerians want to see improvement is road construction.  Motorists have long been enduring bad roads often leading to many avoidable deaths. For instance, the Lagos-Ibadan expressway, which was concessioned to Bi-Courtney Highway Services on May 26, 2009, has continued to claim lives of Nigerians daily in auto crashes and robberies without any effort made to kick start work on the road.  Also, the Benin-Ore road is still a cause for worry for many Nigerians because of the slow pace of work going on there while the Abuja-Lokoja road appears to be forgotten.  In the budget speech, the President mentioned these roads and said once the rains receded, work would resume.

But the President believes it is just a matter of time before Nigerians begin to feel the impact of his administration.  With an aggregate expenditure of N4.92 trillion proposed for the main budget of the 2013 fiscal year, representing an increase of about 5 percent over the N4.7 trillion appropriated in 2012, the President believes that after effectively implementing the budgets on key areas such as  Works – N183.5 billion; Power - N74.26 billion; Education – N426.53 billion; Health – N279.23 billion; Defence – N348.91 billion; Police – N319.65 billion; and Agriculture & Rural Development – N81.41 billion, the economy would be on a sound footing.  On the whole, N380.02 billion is for Statutory Transfers, N591.76 billion for Debt Servicing, N2.41 trillion for Recurrent (Non-Debt) Expenditure and N1.54 trillion for Capital Expenditure. The 2013 budget is anchored on an oil benchmark of $75 per barrel, though both Houses of the National Assembly have insisted that it should be jacked up.  The House of Representatives is insisting on a benchmark of $80 per barrel while the Senate said it should be pegged at $78 per barrel.

  But would this budget represent a continued drive for real and sustainable growth for the wellbeing of Nigerians as the president said? Nigerians are divided on this. In their own reaction, members of the Organised Private Sector, through the Lagos Chamber of Commerce and Industry, LCCI, said they are worried over the growing level of domestic debt and the high cost of debt in the proposed 2013 budget. In a statement by its President, Goodie Ibru, the LCC said the country’s debt profile remains a major source of concern. While the Chamber commended the provision of N100 billion sinking fund for the repayment of maturing debt obligations, it also said it was concerned about the growing level of domestic debt and the high cost of debt servicing. Domestic borrowing is proposed to reduce from N747 billion in 2012 to N727 billion in 2013, a  2.3 per cent reduction while N591.76 billion is earmarked for debt servicing. LCCI said it is curious that while the government gives considerable attention to securitised debts, government did not indicate how it will pay debts owed to contractors.

For Kennedy Izuagbe , an economist and management consultant,  the implementation of the budget was key to enhancing citizens’ welfare. Also, Abiodun Ogunkoya, chief executive officer of BAGCO Manufacturing Nigeria Plc, made the same point, he warned against maladministration by public officers and mismanagement of public funds.

For Adetunji Oyebolu, an ACN chieftain in Lagos state, the President must ensure that the budget is fully implemented. According to him, there is no problem with the 2013 budget estimate but what often constitute a problem is its implementation. But he also said no budget is full proof because it depends on certain variables.



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